The fiscal hawks are sticking to their guns. On Friday, Sens. Ron Johnson (R-WI) and J.D. Vance (R-OH) joined 22 of their fellow Republican senators in a letter warning President Joe Biden that they will not vote for increasing the debt ceiling without structural reforms to the federal government’s budget and debt problems.
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The gridlock that paralyzed House Republicans over the past week in their quest to elect a new Speaker could be a foretaste of more to come, with party moderates and conservatives set to tangle in the months to come over raising the debt ceiling and reining in reckless government spending.
Although newly elected Speaker of the House Kevin McCarthy ultimately prevailed in his bid for the office over a small but determined band of House Freedom Caucus members, his slim GOP majority in the House will be vulnerable if and when conservatives rebel again down the road, as some are predicting, in an effort to reassert debt reduction as a top priority for the party.
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President Joe Biden sparked controversy for pushing through Congress increased federal funding for 87,000 new IRS employees to audit Americans, but Republican leadership has pledged to overturn that expansion if they win the majority.
House Republican Minority Leader Kevin McCarthy, R-Calif., pledged at a Pennsylvania event to “repeal” the IRS expansion.
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“Our expectation has been we would begin to see inflation come down, largely because of supply side healing. We haven’t. We have seen some supply side healing but inflation has not really come down.”
That was Federal Reserve Chairman Jerome Powell on Sept. 21, speaking to reporters following the central bank’s meeting where the Federal Funds Rate was once again increased 0.75 percent to its current range of 3 percent to 3.25 percent in a bid to combat sticky 8.3 percent consumer inflation the past year.
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Gov. Gretchen Whitmer is touting the $77 billion 2023 fiscal year budget that she says will improve Michigan’s economy and workforce.
Whitmer bragged that the budget negotiated with Republicans doesn’t raise taxes. However, it also keeps $7 billion of taxpayer money locked in state coffers while spending another $7 billion more than the prior budget.
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U.S. Treasury Secretary Janet Yellen will testify before the Senate Finance Committee Tuesday, just days after she admitted she was wrong about inflation earlier in President Joe Biden’s term.
The hearing, which is on “the president’s fiscal year 2023 budget” will only feature testimony from Yellen, according to the committee’s website.
Biden’s budget likely will be under extra scrutiny as gas prices continue to hit record highs and inflation rises at the fastest level in decades.
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Inflation is running rampant, federal spending is out of control, gas prices are at an all-time high and Americans are pessimistic on the future outlook of the economy. So what is President Joe Biden’s solution?
He has released a budget proposal that includes 36 tax increases on families and businesses totaling $2.5 trillion over the next decade. Alarmingly, this includes 11 tax increases on the oil and gas industry, taxes that will put a burden on households.
The budget doesn’t even include all the tax increases being pushed by Democrats because the budget omits the cost of tax increases within their stalled multi-trillion dollar Build Back Better Act. Instead of detailing these tax increases, the Biden budget includes a placeholder asserting that any new spending will be fully offset.
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Gov. Gretchen Whitmer vetoed a GOP bill that aimed to provide $2.5 billion in tax breaks by dropping the personal income tax rate from 4.25% to 3.9%, saying it would blow a “hole” in her $74 billion budget.
“It would force tax hikes on families or deep and painful cuts to services, hurt our children’s ability to catch up in school, force layoffs of cops and firefighters, and kneecap our ability to keep fixing crumbling roads,” Whitmer wrote in her veto letter.
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Gov. Gretchen Whitmer welcomed the expansion of free or low-cost child care to 105,000 more kids via the expanded income eligibility criteria in the latest bipartisan budget.
Families of four earning up to $49,000 will be eligible for free or low-cost child care under new criteria, helping parents return to work
“We need to continue working hard to drive down costs for families and expand access to high-quality, affordable childcare so parents can go to work knowing that their kids are safe and learning,” Whitmer said in a statement. “I was proud to put childcare first in the bipartisan budget I signed in September. Together, we lowered costs for working families by expanding low or no-cost care to 105,000 kids and providing grants to improve childcare programs and empower childcare professionals. Countless working parents rely on childcare, and we must continue expanding high-quality care to help every working family thrive.”
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The Democrats’ reconciliation package will likely include more than $500 billion worth of climate provisions, more than the entire Department of Energy budget, the White House said, according to The Hill.
The budget represents an opportunity for “historic investment in climate change,” White House Chief of Staff Ron Klain said during an event hosted by The Hill on Tuesday evening. The likely price tag for climate programs included in the bill is likely to fall somewhere between $500 billion and $555 billion, Axios previously reported.
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On Monday, Joe Biden uncorked the largest lie of a 50-year political career overstuffed with them.
“My Build Back Better Agenda costs zero dollars,” he tweeted. “Instead of wasting money on tax breaks, loopholes, and tax evasion for big corporations and the wealthy, we can make a once-in-a-generation investment in working America. And it adds zero dollars to the national debt.”
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Democratic West Virginia Sen. Joe Manchin reportedly said in private that the “strategic pause” he has pushed for regarding his party’s budget should last through the end of the year.
Manchin’s remarks, first reported by Axios, would mean a sharp departure from Democrats’ long-stated goals, which include passing both the budget and the bipartisan infrastructure bills before the end of September.
His remarks align both with a Wall Street Journal op-ed he wrote earlier this month and recent comments he made calling for a “pause” on the budget as Congress addressed other priorities ranging from a messy Afghanistan withdrawal to multiple natural disasters.
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House Democrats will consider nearly $3 trillion in tax hikes over the next decade in an attempt to pay for their $3.5 trillion budget that includes most of President Joe Biden’s domestic agenda and would overhaul the nation’s social safety net.
The hikes are predominantly focused on wealthy Americans and large corporations. Among the increases is a top income tax bracket of 39.6%, up from 37%, which Democrats say would raise $170 billion in revenue over the next decade.
A summary of the proposals leaked Sunday, and was first reported by The Washington Post.
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Last week, Gov. Gretchen Whitmer’s (D-MI) State Budget Director Dave Massaron instructed state department heads to begin preparing for a possible government shutdown, though Michigan taxpayers may have other concerns to expect from current budget negotiations.
Technically, Michigan state lawmakers are supposed to have passed a full budget for the governor’s signature by July 1, although officials have until Sept. 30 to finalize an agreement that would avoid a partial government shutdown.
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Washington Democrats’ efforts to pass their signature, $3.5 trillion spending package is in jeopardy of falling apart, as House Speaker Nancy Pelosi, leader of the Democrat-controlled chamber, does not appear to have the votes this week to advance the measure awaiting in the Senate.
The votes are set to be cast Monday and Tuesday, with House members returning for two days during their August recess to try to move forward the pending package.
Pelosi can afford to lose only three votes in the narrowly divided chamber. However, nine moderate Democrats have vowed to oppose the two voting measures until the House passes a roughly $1 trillion, bipartisan infrastructure spend package passed in the Senate before the recess.
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As tens of millions of American families across the country began to see the second round of monthly cash payments appear in their bank accounts Friday, Republicans in Congress remained oddly quiet.
The checks were the result of an expansion of the Child Tax Credit (CTC), which was part of the $1.9 trillion coronavirus relief package President Joe Biden signed into law in March. While every Republican in Congress voted against the bill, the credit itself is overwhelmingly popular among registered Republicans and Americans overall, creating a rift between reliable conservative voters and the GOP lawmakers who represent them.
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The unadjusted consumer price index as measured by the Bureau of Labor Statistics was 5.28 percent for the month of July, slightly lower than June at 5.32 percent, but still measuring the highest inflation on record since July 2008, when it hit nearly 5.5 percent.
The latest numbers come as Congress has easily passed another gargantuan $1.2 trillion infrastructure spending plan that included $550 billion of new spending. Interest rates have already reacted as 10-year treasuries came off a near-term low of 1.17 percent on Aug. 2 to 1.36 percent as of Aug. 12, slightly increasing inflation expectations.
The $1.2 trillion spendathon was just the latest in a long line of spending that has added $5.25 trillion to the national debt since Jan. 2020 in response to the Covid pandemic all the way to the current $28.5 trillion: the $2.2 trillion CARES Act and the $900 billion phase four under former President Donald Trump, and then the $1.9 trillion stimulus under President Joe Biden. It’s been a bipartisan affair.
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Senate Democrats have publicly released their $3.5 trillion, filibuster-proof budget reconciliation resolution.
The draft of the legislation released on Monday includes new spending programs that the White House has labeled “human infrastructure,” such as universal pre-K, childcare support and tuition free community college.
The spending total is estimated over a 10-year period. Using budget reconciliation allows the Democrats to pass the measure without votes from Republicans in the 50-50 Senate. Democrats used the same process in March to pass President Biden’s $1.9 trillion pandemic stimulus package called the American Rescue Plan Act.
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The Congressional Budget Office estimated Thursday that the bipartisan Senate infrastructure bill will add $256 billion to the deficit over the next decade, undercutting its backers’ claims the spending had been offset.
In FY2020, the deficit hit a record $3.1 trillion. So far in FY2021, the deficit is $2.2 trillion. The national debt is climbing to $29 trillion for the first time in U.S. history.
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Senate Democrats are attempting to add funding for “Dreamers” and border security to their budget bill, Axios reported Friday.
The Democrats are looking at adding $10 billion to their $3.5 trillion budget reconciliation package towards border security infrastructure at legal points of entry, according to Axios. The Democrats previously planned to allocate around $120 billion for citizenship for undocumented essential workers, immigrants with Temporary Protected Status and Dreamers.
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Although she thinks it’s only a “start,” Gov. Gretchen Whitmer applauded the bipartisan budget passed Thursday night by the Michigan House of Representatives.
The House voted to pass the budget before the July 1 deadline, and includes the governor’s proposal to implement the largest increase in K-12 public school spending in the state’s history. Whitmer’s office claims the $16.7 billion in school expenditures will “close the gap between the lowest- and highest-funded school districts for the first time since the goal was introduced in 1994.”
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Congressional Republicans grabbed headlines this week after releasing an aggressive budget they say would cut taxes and spending, but key measures in the plan also would address one of the country’s most serious economic problems.
The House’s Republican Study Committee released a budget that lays out several measures to deal with inflation, a growing concern among economists after the latest federal data showed a spike in consumer prices. Notably, the index for used cars and trucks rose 10%, the largest one-month increase since BLS began recording the data in 1953. Food and energy costs rose 0.9% in the month of April, prescription drugs rose 0.5%, and gasoline rose 1.4% during the same month. The energy cost index rose 25% in the previous 12 months.
Republicans on the committee say their plan would address concerns over inflation by balancing the budget within five years, thereby eliminating the need to monetize debt, a process where the federal government prints money to make payments on what it owes. The national debt has soared to more than $28 trillion and is expected to continue climbing under President Joe Biden’s new spending plans.
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After 14 months of fighting over COVID-19 policy, GOP leaders and Gov. Gretchen Whitmer reached an agreement Thursday to negotiate the state budget and stimulus money in return for setting a date to end COVID-19 restrictions.
In return, Whitmer has agreed to withdraw the Michigan Occupational Safety and Health Administration’s (MIOSHA) proposed permanent rules and discuss legislative input on epidemic orders.
“Throughout the pandemic, we saw Michiganders all over the state step up and come together to slow the spread of COVID-19 and save lives,” Whitmer said in s statement. “Now, Michigan’s task is to unleash the potential of our people, to drive innovation and investment, and create tens of thousands of jobs and economic prosperity for all. Together, we can stay laser-focused on growing the economy and getting Michiganders back to work. Let’s hit the gas.”
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2020 and 2021 are two sides of the same coin: Price instability brought about by the dollar being either relatively too strong or too weak, which can lead to or exacerbate economic slowdowns, creating higher unemployment and worse if the conditions persist for too long.
In 2020, at the height of the Covid pandemic, the problems included the global economy being shut down plus local lockdowns resulting in a massive recession and a flight to safety into U.S. treasuries as interest rates collapsed, making the dollar too strong. With the onset of deflation, consumer prices plummeted in March and April 2020, with oil even dropping briefly below zero dollars for the first time in history, and a concurrent rise of unemployment as 25 million Americans lost their jobs.
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Michigan’s General Fund and School Aid Fund tax revenues dropped $1.24 billion since January 2020, according to figures released Friday by state administrators and fiscal analysts.
The latest state consensus revenue estimating conference also projected an $84 million shortfall for 2021.
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House Democrats blocked a Republican attempt on Monday to require any proposed climate change legislation to also include its projected cost.
Under the Pay As You Go (PAYGO) rule, any additional government spending proposed must be accompanied by tax increases or separate cuts. After a push from several lawmakers in the Democratic Party’s progressive wing, however, the rules package for the 117th Congress states PAYGO will not apply to legislation relating to the necessary economic recovery or U.S. efforts to combat climate change.
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Michigan leaders sealed a $62.8 billion fiscal 2021 budget agreement, increasing spending by billions from last year’s initial budget even after state revenue plummeted from COVID-19 and policies placed to curb its spread.
Experts previously estimated Michigan’s revenue would drop by $6.3 billion over the next two fiscal years.
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Is America in a recession? It’s an unpopular question to ask, but it has now been over 3 months since COVID-19 restrictions were initiated and it is time for us to get realistic about where we are economically so that we can take the proper steps to minimize further damage to our economy. At this point, the unfortunate reality is that regardless of what we do, it is likely that it will take at least several years to see a partial recovery of economic loss and the time that it will take for a complete recovery remains unknown at this point.
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A House bill package seeks to put about $800 million annually into local roads without a 45-cent gas tax hike or increasing future debt.
The six-bill package, if enacted, would eliminate the six percent sales tax on fuel over three years and replace it with another excise tax that would fund the 92 percent of local roads that aren’t touched by Gov. Gretchen Whitmer’s $3.5 billion bonding plan.
Much of that bonding money would go to repair roads in Metro Detroit.
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State Superintendent Michael Rice (pictured above) praised the school funding increases included in the budget proposed by Gov. Gretchen Whitmer, saying it set the path for a growth within the Michigan school system.
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President Trump’s budget proposal includes nearly an eight percent cut to the Department of Education, a choice that has received backlash from Democrats.
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One initiative in President Donald Trump’s fiscal 2021 budget, to be presented to Congress Monday, targets waste, fraud and abuse of taxpayer money.
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Despite deep budget cuts for the Environmental Protection Agency at large, the budget plan for 2021 proposed by President Trump grants full funding to protection programs for the Great Lakes.
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State lawmakers nationwide are spending more money, but they are also replenishing rainy day funds in preparation for the next economic downturn, a new report determined.
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Gov. Gretchen Whitmer and Republican congressional leaders did not take any action after Thursday’s meeting to address issues around the almost $1 billion left out of Michigan’s final budget.
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Several Republican Michigan representatives are calling for restored funding in the state budget for initiatives vetoed by the governor, including the Pure Michigan campaign and programs designed to help students with mental health issues and special needs.
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The Michigan House and Senate passed a $15.2 billion school aid budget on Thursday which increased funding for classrooms by $304 million and special education services by $30 million.
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